Dollar shrugs off weak US data

Matthew Ryan, CFA Ebury

Our view that market pricing for a long series of Fed hikes was overdone was vindicated last week. Core PCE inflation came in at 3.0% for August against 3.3% expected, and September payrolls rose by only 29k against expectations of around 85k, with 60k in downward revisions to the previous two months of data.

Just as we discounted somewhat the strength of the previous report, we will not worry too much about this month's weakness, and note that the three-month average of net job creation remains around the 50k level, which appears sufficient to maintain a steady level of unemployment.

The greenback was unfazed, however. Unlike the US-led sell-offs of the past 18 months, when doubts about American policy dragged the dollar lower, the current rout is global and increasingly about fiscal credibility in places like France and the UK. Market scepticism about government finances seems to have spared the US so far, at least in relative terms.

Author

Matthew Ryan, CFA

Ebury

Matthew is Global Head of Market Strategy at FX specialist Ebury, where he has been part of the strategy team since 2014. He provides fundamental FX analysis for a wide range of G10 and emerging market currencies.

AUD/USD turns south toward 0.6900 as USD firms up

AUD/USD sees fresh selling and drops toward 0.6900 in late Asian trading on Monday, as renewed US Dollar strength weighs on the pair amid lingering Middle East and Russia-Ukraine geopolitical tensions. Focus remains on Oil prices, Treasury bond yields, and RBA expectations for fresh trading impetus in the major.

USD/JPY retakes 158.00 amid hawkish BoJ bets, firmer USD

USD/JPY erases losses and retakes 158.00 in the Asian session on Monday, trading within a one-week-old range. Geopolitical uncertainty continues to underpin the US Dollar, despite fading Fed rate hike hopes, supporting the pair's rebound. However, further upside could be capped by hawkish BoJ expectations and looming intervention risks that could support the Japanese Yen.

Gold languishes below $4,200 amid high US yields

Gold trims some losses on Monday, but remains trapped within previous ranges, with upside attempts limited below $4,200 and with two-month lows of $4,110 at a short distance. The recent pullback on the US Dollar Index has provided some support for precious metals although the high US Treasury yields are keeping a floor on US Dollar dips so far.

Pi Network risks a steeper decline as bearish momentum builds

Pi Network extends losses below $0.090 maintaining a steady decline for the fifth consecutive day. The retail demand remains firm, with the notional value of active perpeutals holding above $10 million. The technical outlook for PI remains bearish as bearish momentum mounts.

ISM Services PMI expected to show robust US economy in September

The US ISM Services PMI is expected to improve marginally in September. The US services sector is expected to remain well into expansionary territory. Bets of further Fed tightening appear to have lost traction in the last few days.

The Euro is near a one-year low: Inflation could trigger its rebound, not its fall

EUR/USD has fallen to its lowest level since May 2025. The pair hit 1.1312 on Wednesday and trades well below the January peak of 1.2082. The decline reflects a powerful combination of US Dollar strength, geopolitical uncertainty and renewed concerns about Europe's exposure to higher energy prices.